Businessmodel of 8×8

Customer Segments

8x8 has a niche market business model, with a specialized customer segment. It primarily operates in the cloud communications and collaboration services, a market in which the North American spending is expected to increase at a CAGR of 29% to US$14 billion in 2021. In this market, the company caters to a range of business customers, including SMBs and mid-market & larger distributed enterprises.

It serves 45,000 customers operating in over 100 countries across six continents, and has become the industry’s leading provider of secure, reliable enterprise cloud communications solutions.

8x8’s offerings are uniquely positioned to serve businesses of all sizes and can easily scale up, globally distributed enterprise customers. Its turnkey solution spans the breadth of communications and collaboration needs, provided with industry-leading reliability at an affordable cost. This allows customers to focus on their business instead of managing the complexities of disparate communications and collaboration platforms and the integration of these platforms with other cloud-based business applications.

Value Proposition

8x8’s value proposition lies in helping enterprises solve critical challenges facing businesses today through increased customer satisfaction and loyalty, effective collaboration and communication, freeing up IT resources, with maintenance-free communications and easy deployment and unifying communications throughout the entire enterprise.

It also creates value for enterprises by integrating mobile devices such as smartphones, tablets and laptops into the communications strategy, viewing real-time and historical data about crucial business functions for faster, better decisions and by keeping costs low and productivity high, with one easy-to-use economical system.

This offers its clients security and compliance, reliability backed by exceptional customer support and performance assured services with a global presence and network.

Channels

The company markets its services directly to end users through a variety of means including search engine marketing and optimization, third party lead generation sources, industry conferences, trade shows, webinars, traditional advertising channels and other demand generation activities.

It employs a multi-tiered direct sales force and indirect channel partner network consisting of VARs (value added resellers), master agents, system integrators and service providers in the U.S., Canada, UK and Australia to identify, qualify and manage prospects throughout the sales cycle.

The company’s sales professionals work closely with inside technical support, sales engineers and deployment specialists to develop customized proposals based on individual customer requirements.

Customer Relationships

8x8 lays special emphasis on customer service, quality and building strong relationships. Its solutions have been designed to allow users to communicate and collaborate with others in an integrated and fluid manner. Also, its cloud software solutions encompass all of the primary communications capabilities required by businesses - voice, video, presence, chat, conferencing, collaboration, contact center and analytics - providing multiple buying paths and usage scenarios for customers.

The company’s solutions link customer information with internal collaboration capabilities to provide synchronized customer engagement. It has also released a series of analytic tools in 2016 that give businesses visibility into employee communications in the contact center and the enterprise.

8x8 serves its customers via a global reach to 114 countries. Moreover, it also maintains a call center in San Jose, California and have a staff of ~90 employees and contractors that provide customer service and technical support to customers.

Key Activities

8x8 Inc provides cloud-based, enterprise-class software solutions that transform the way businesses communicate and collaborate globally.

The company’s integrated, ‘pure-cloud’ offering combines global voice, conferencing, messaging and video with integrated workflows and big data analytics on a single platform.

Key Partners

The company has telecommunications interconnect and service agreements with VoIP providers and PSTN telecommunications carriers, such as Level 3 Communications, Verizon Communications and Inteliquent.

Key Resources

8x8 has been awarded over 120 US patents since its inception and has several more in its pipeline which is a key resource to the company. In addition, the company heavily relies on its 810 employee’s workforce for running its R&D, marketing and other key activities.

8x8’s twelve data centers across eight locations around the world is also a valuable resource for day to day running.

Cost Structure

8x8’s main cost consist primarily of personnel related expenses which includes deployment engineering, costs associated with outsourced customer service call center operations, commissions and other marketing and promotional expenses.

Other significant costs include expenses related to the services purchased and the technology licensed from 3rd party carriers.

Due to the industry that the company operates in, 8x8 makes significant investments in research and development to keep itself at pace with rapid technological changes and advancements.

Revenue Streams

8x8’s core offering of cloud communication software solutions is the main contributor to its revenue and remains its main focus area for the future.

The company also generates revenues from the sale of its IP telephones for providing its cloud telephony service.